Global supply chain optimization requires a comprehensive perspective of partner interactions. This comprehensive optimization perspective is even more critical when viewed in the context of environmental issues. The environmental or “green” context in which many of today’s manufacturing firms operate is dynamic, influential and developing into a critical issue for firm stakeholders, especially for internationally connected firms. In a green-focused operating arena, firms require a binary focus where they must concentrate on doing well operationally and environmentally. To maintain this dual edge, firms must take a much broader perspective of their operations, partner relations and manufacturing impacts. These differing perspectives necessitate unique organizational and partner management strategies to develop and sustain both a traditional competitive advantage as well as sustainable business practices.

Building on a literature base of contingency theory, complexity theory and RBV and natural RBV theory, several main factors were assessed with regard to achieving enterprise success. High quality, intensive and integrative supply chain partner interactions can enhance a manufacturing firm’s resource base through significant gains in knowledge and expertise. In particular the partnership interactions of the firm, and their antecedents of the internal and external climates of a firm, were examined as the core of the model.

Despite the potential value of research in supply chain partner relationships in an environmental context, empirical research on this topic is sparse. This study contributes to the knowledge base of supply chain research by assessing the influence of supply chain partner interactions on both manufacturing and firm performance, and evaluating how manufacturing and firm performance may be influenced by the environmental or “green” climate (of industrial and organizational factors) in which a firm operates.

Utilizing a survey assessment of ISO 9000 and ISO 14000 companies, this study examined 175 responses from senior managers in US manufacturing companies and examined the proposed model using Structural Equation Modeling (SEM). The empirical results identified that a firms’ external climate influences a firm’s culture and leadership type, and that there are significant influences between this internal climate and a firm’s developed partnership interactions with customers and suppliers. These customer and supplier partnership interactions are critical to obtaining manufacturing and firm performance success. Comparative analyses also suggest differences between enterprise focus on environmental versus non-environmental issues.